It is expected that a lot of the new light vehicles in the future will be electrical vehicles (EV). The storage capacity of these EVs has the potential to complement renewable energy resources and mitigate its intermittency. However, EV charging may have negative impact on the power grid. This paper investigates the impact on a Danish distribution system when the EV charging aims to reduce the charging cost by charging at the cheapest hours. Results show that the charging based on the price signal only will have adverse effect on the grid. The paper also proposes an alternate EV charging method where distribution system operator (DSO) optimizes the cost of EV charging while taking substation transformer capacity into account.